Contacting Owners of Foreclosure Properties

13 Replies

  Hi All, 

  I just finished responding to a post by another BP member about contacting the owners of Foreclosure properties.  I thought I would post my response here as well in order to share my journey thus far as a newbie investor: (I revised my response because I forgot a few things!)

   I live in Temecula, CA (Near San Diego County) and I'm currently in the process of locating Foreclosed properties slated for Auction. My daily routine (in no particular order) is:

1. Driving for Dollars - This is really putting your finger on the pulse, and a great way to get to know the neighborhoods you want to invest in (or finding out the ones you really, really don't!)

2. Searching the MLS (I have access since I'm an Agent) - Unfortunately, there are very few Foreclosures in my area that are listed on the MLS, and if they are, they generally or not very good deals, which I find out by analyzing the properties using the BP tools and my own Excel Spreadsheet I created.

3. Searching Craigslist for FSBO's, - Again, very few ads even come up for these and they are spotty as far as locations I am interested in.  I'm finding that most ads are being placed there by Agents, so not off market like we are all looking for, but this could be different in other parts of the state and country.

4.  Checking Auction sites - If I find the property to be of interest, I will drive over there and check it out.  Then, research the owner and try to contact them.  So far I have been able to speak with neighbors and left notes on doors, and even had one neighbor offer to contact the owner and give them my information.

5.  Search the Title Company site that a Rep gave me access to- I can search for Foreclosures in specific areas and create a list, then pay 0.06 cents per record. The next step is to send the owners a postcard.  I will also be attempting to obtain phone numbers, but haven't got that far yet. 

6.  Place an ad on Craigslist offering to Buy Homes for Cash - So far no responses, but I continue to renew my ad and change it up each time.  In my area there are literally hundreds of similar ads posted, as this is a highly competitive market!

7. Analyzing deals - I am continuously analyzing deals using the BP tools and my own Excel Spreadsheet.  At first it was VERY time consuming, but the more I do it, the faster I get!

  All this while being a single Mom to 3 kids, (my youngest has been pulling on my arm the entire time I am writing this post because she wants me to watch YouTube Videos with her, but I have to tell her Mommy is working, just give me 15 minutes which could be a topic for a whole other post!)

  I've been at this pretty much daily for about 3 weeks now, but haven't received any solid responses...YET.. I'm NOT GIVING UP!

  I have some friends who are successful Investors and they have told me in my market I will get about a 1/2 percent response rate to any DM, and that's just people contacting me, then I will still need to vet those calls and try to secure a deal. One of my friends sends out 5000 postcards per month! Unfortunately, I don't have the budget for that now, so it's all on me to do as much of the grind as I can.

  Everyone wants the easy, simple answer to how they get Foreclosed properties, but the truth is, it takes time, energy, research, networking, studying, money for advertising/gas/marketing materials, etc., and most importantly, persistence!

  In the next few weeks, I have no doubt that I will be posting on BP that I have secured my first property, because I am willing to do whatever it takes to get the job done!

@Sharon Thorson Wow, You are definitely willing to put in the grind to get started.

I'm not in Cali, but my business model is primarily built around foreclosures, I would say at least 75% of my acquisitions have been foreclosures, and I've acquired around 30-35 properties since I started investing in real estate 18 months ago.  Most I rehabbed and sold, some I wholesaled to other investors to flip or keep as rentals, and I've also kept 11 myself so far.

Anyway, here's my experience with the methods you're using:

1. Driving for Dollars - I rarely ever do this unless there's a specific property I'm going to look at, or if I see a FSBO sign while driving somewhere. If so, I will drive the neighborhood around those homes. I think D4D isn't very productive from my experience other then if there's a property you're already interested in, or like you said getting to know neighborhoods, but again this can be accomplished once you have a potential deal to go look at.

2. Searching the MLS - I know that most the foreclosures on MLS are not good deals, however I have had some success with this method. The listed price on MLS is typically approximately the balance of the mortgage or an estimated value. I've found you can acquire some of these properties for a much lower price. I still research every one of these and any I am interested in, I put in my lower offer.

3. Searching Craigslist for FSBO's, - Most of these are usually wholesalers from my experience, but once in a while you find a deal on there, and it doesn't take long to search them, especially since you can sort by zip code radius, price range, etc.

4. Checking Auction sites - I've purchased several properties from Auction sites.  However I rarely ever go to the initial sheriff's auction on foreclosures because I've found the majority of the time the bank will buy the property or it will sell for too much.  But once its listed on auction sites as bank owned, I've had a lot of success buying these, in fact bought one last week.

5. Search the Title Company site - I've never tried this, but will be asking my title lady about it.  Thanks for this idea!!

6. Place an ad on Craigslist - If CL in your area is like it is where I operate its full of wholesalers ads "We Buy Homes" etc.  But these do generate some leads for me.  I place 2-5 different ads once a day, and renew them every time CL allows renewals.  I have them pre-typed out in a word doc and just cut and paste, saves a ton of time.  I think this method is worth the time because its free and doesn't take much time.  I've found ads that seem like a company or big investors do not get near as good a response as one that seems like a local individual.  I run both types but one ad that I have received the best results from simply says "My Wife and I Are Looking to buy Fixer Upper Homes (References Available)"

7. Analyzing deals - Keep this up.

OTHER METHODS-

8. Website and SEO - if you do not have a "Cash Buyer" website set up yet, this is the first investment I would recommend.  I use Investor Carrot site, their basic site is only $49/mo which is all you need at first if only using it to acquire leads.  They have all kinds of free tools, and walk you through setting up SEO.  In my markets if someone googles "sell my house" or many other terms, my website comes up as one of the top 1-3 on the first page, it takes time for your site to rank that high, but once it does, you will get a lot of free leads.

9. FaceBook Ads - I do very well with these, they can get expensive, but it only takes one good deal to make it worth the investment.  I average spending around $100 per lead, and of course many of the leads want too much for their property, but I typically land a good deal that I close on with every $2,500 invested in ads.

10. GoogleAds - This can be expensive also, but it can generate specifically targeted leads.

11. Direct Mail - I don't do much DM, just never had very good results on the campaigns sent for the cost, and in my markets everyone is doing DM.  I do keep preprinted post cards on hand, to send out though.  And I also like to send hand written cards.

12. Business Cards "2 Cent Billboards" - I buy generic business cards 10,000 at a time that just say "WE BUY HOMES, ANY CONDITION, ANY LOCATION, etc with my website" and always carry a box with me, and leave small stacks everywhere I go. I also leave them with other people and ask them to give them to anyone they know. If you order from VistaPrint 10,000 at a time, even with shipping they only cost around 2 cents each. 

13. Bank REO list - This is another source for foreclosures I've used.

One other suggestion, and you're probably doing it already, but make sure everyone you know knows you're looking to buy properties.  I get a lot of referrals from friends and family, because I always talk about my business, so they refer anyone to me they know looking to sell.

Good luck!! Keep grinding!!

Damn you two are definitely laying down an awesome blueprint! Move to Orlando and with that work ethic I promise you’ll make a fortune ;)

Don’t forget searching local newspapers & records for recent divorces, deaths and estate sales

Good morning all. Russ Montenero here, pro member.

Challenge I find is getting the owner’s phone number after finding property info online. White pages requires a membership so I have been using the good all fashion 411.

@Sharon Thorson

Kudos to you for grinding so hard.

0.5% sounds more like SD / OC / LA, around Temecula it should be a bit higher because it's more periphery. 

What are you doing with #1 to follow-up on leads? You need to combine that with either DM, cold-calling, or door-knocking.

Do you have any practice in listening for distress and motivation? 

The good news is, as an agent when you do marketing your marketing is twice as effective because you can offer solutions to sellers that have the means to fix up their property to earn your commission, or to wholesale it to the other investors you've networked with if they are in distress and motivated to sell.

Couple of notes:

1) Great for generating your list and learning the area, but how you follow-up on the leads is the key

2) Time-consuming but can yield leads if you can process 50+ new deals a day quickly, once you're familiar with the numbers. Most new listings are garbage. If you network with other agents who have pocket listings, you may have a better shot. Not very viable for wholesaling but viable if you are BRRRRing or flipping since we're in SoCal

3) Great for practice on talking to sellers and learning to listen for DMF

4) Low probability in our market

5) Good probability bet - not as many investors doing this.

6) Doesn't hurt, low probability, but persistence may pay off.

7) You need to practice at least 10 deals a day until it becomes really easy and fast. BP calculator is time consuming, once you understand it well, you can do it much faster than using that.

Feel free to continue sending me any questions directly, I really want to see you get your first deal and build a pipeline. 

Thank you everyone for your awesome replies to my post!  I am definitely going to take all your advice to heart and continue to work the process!  Keep posted!

Sharon,

Do you have any of your own money and are you looking to wholesale these deals? Flip? What's the plan?

Gail

@Gail Greenberg Hi, I have a private $ lender and a few hard $ lenders in place for any potential properties. I am looking to Flip in general or BRRRR, if the opportunity is a better fit. Thanks for your inquiry!

@Chris Grenier, thank you so much for the tip!  I will look into those sources.  Thanks!

Hi Timothy,

  Yes I did, I ended up buying a gutted home in Scottsdale from another investor.  I rehabbed and flipped it in 8 months.  You can read my blog about it.

Thanks for asking!

Just read through this post. Awesome. Thank you! 

Thank you @johnathansafa.  It was a wonderful experience and we fell in love with Scottsdale in the process! 

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here